3 February 2023
Etalon Group Reports Operating Results for FY and 4Q 2022
ETALON GROUP PLC ("Etalon Group" or the "Company"), one of Russia's largest and longest-established development and construction companies, announces its unaudited operating results for the fourth quarter and twelve months ended 31 December 2022, based on management accounts.
FY 2022 operating highlights
· Deliveries increased by 74% to 735 ths sqm, a record for the Company
· New contract sales amounted to 292.4 ths sqm, or RUB 58.7 billion, excluding sales made by YIT Russia prior to its acquisition by Etalon Group
· Cash collections amounted to RUB 60.4 billion excluding the impact of the acquisition of YIT Russia, or RUB 75.0 billion including funds accumulated from YIT Russia's development business as of the moment of Etalon Group's takeover
· The average price per sqm increased by 6% year-on-year to RUB 200.6 thousand
· The average price per sqm of residential property rose by 10% year-on-year to RUB 261.7 thousand
FY 2022 operating results
| | 2022 | 2021 | Change, % |
| New sales, sqm | 292,396 | 446,480 | (35%) |
| New sales, RUB mln | 58,652 | 84,388 | (30%) |
| Number of contracts | 6,457 | 8,560 | (25%) |
| Cash collections, RUB mln | 60,386 | 84,094 | (28%) |
| Average price, RUB/sqm | 200,591 | 189,008 | 6% |
| Average price (apartments), RUB/sqm | 261,721 | 238,677 | 10% |
| Deliveries, sqm | 734,773 | 421,209 | 74% |
Regional breakdown
| | 2022 | 2021 | Change, % | |
| Moscow and the Moscow region | ||||
| New sales, sqm | 121,371 | 237,412 | (49%) | |
| New sales, RUB mln | 32,296 | 54,053 | (40%) | |
| Number of contracts | 2,645 | 4,654 | (43%) | |
| Cash collections, RUB mln | 31,501 | 52,436 | (40%) | |
| Average price, RUB/sqm | 266,096 | 227,675 | 17% | |
| Average price (apartments), RUB/sqm | 344,131 | 275,549 | 25% | |
| Deliveries, sqm | 343,971 | 176,067 | 95% | |
| St Petersburg | ||||
| New sales, sqm | 120,619 | 209,068 | (42%) | |
| New sales, RUB mln | 20,944 | 30,335 | (31%) | |
| Number of contracts | 2,609 | 3,906 | (33%) | |
| Cash collections, RUB mln | 24 206 | 31,658 | (24%) | |
| Average price, RUB/sqm | 173,634 | 145,099 | 20% | |
| Average price (apartments), RUB/sqm | 250,674 | 192,124 | 30% | |
| Deliveries, sqm | 337,578 | 245,141 | 38% | |
| Other regions | | | | |
| New sales, sqm | 50,405 | - | | |
| New sales, RUB mln | 5,412 | - | | |
| Number of contracts | 1,203 | - | | |
| Cash collections, RUB mln | 4,679 | - | | |
| Average price, RUB/sqm | 107,369 | - | | |
| Average price (apartments), RUB/sqm | 119,428 | - | | |
| Deliveries, sqm | 53,223 | - | | |
4Q 2022 operating highlights
· New contract sales exceeded 81.9 ths sqm, or RUB 16.0 billion
· Cash collections amounted to RUB 16.6 billion
· The average price per sqm reached RUB 195.3 thousand
· The average price per sqm of residential property amounted to RUB 229.3 thousand
4Q 2022 operating results
| | 4Q 2022 | 4Q 2021 | Change, % |
| New sales, sqm | 81,934 | 129,070 | (37%) |
| New sales, RUB mln | 16,004 | 24,851 | (36%) |
| Number of contracts | 1,770 | 2,405 | (26%) |
| Cash collections, RUB mln | 16,579 | 23,897 | (31%) |
| Average price, RUB/sqm | 195,324 | 192,538 | 1% |
| Average price (apartments), RUB/sqm | 229,297 | 261,121 | (12%) |
| Deliveries, sqm | 408,804 | 237,110 | 72% |
Quarterly operating performance
| | 4Q 2022 | 3Q 2022 | 2Q 2022 | 1Q 2022 | 4Q 2021 |
| New sales, sqm | 81,934 | 66,986 | 53,036 | 90,439 | 129,070 |
| New sales, RUB mln | 16,004 | 13,329 | 9,638 | 19,681 | 24,851 |
| Number of contracts | 1,770 | 1,572 | 1,216 | 1,899 | 2,405 |
| Cash collections, RUB mln | 16,579 | 11,170 | 11,402 | 21,235 | 23,897 |
| Average price, RUB/sqm | 195,324 | 198,985 | 181,732 | 217,611 | 192,538 |
| Average price (apartments), RUB/sqm | 229,297 | 250,326 | 294,096 | 290,140 | 261,121 |
| Deliveries, sqm | 408,804 | 91,295 | 58,981 | 175,693 | 237,110 |
Monthly sales dynamics in 4Q 2022
|
| Oct. 22 | Nov. 22 | Dec. 22 |
| New sales, sqm | 21,112 | 25,375 | 35,447 |
| New sales, RUB mln | 4,197 | 4,947 | 6,859 |
| Cash collections, RUB mln | 5,410 | 4,960 | 6,209 |
Regional breakdown
|
| 4Q 2022 | 4Q 2021 | Change, % | |
| Moscow and the Moscow region | ||||
| New sales, sqm | 28,493 | 56,849 | (50%) | |
| New sales, RUB mln | 7,683 | 14,868 | (48%) | |
| Number of contracts | 618 | 1,146 | (46%) | |
| Cash collections, RUB mln | 7,687 | 14,118 | (46%) | |
| Average price, RUB/sqm | 269,655 | 261,542 | 3% | |
| Average price (apartments), RUB/sqm | 328,379 | 329,779 | - | |
| Deliveries, sqm | 102,908 | 85,878 | 20% | |
| St Petersburg | ||||
| New sales, sqm | 25,534 | 72,220 | (65%) | |
| New sales, RUB mln | 5,039 | 9,982 | (50%) | |
| Number of contracts | 533 | 1,259 | (58%) | |
| Cash collections, RUB mln | 5,921 | 9,779 | (39%) | |
| Average price, RUB/sqm | 197,335 | 138,221 | 43% | |
| Average price (apartments), RUB/sqm | 261,911 | 197,093 | 33% | |
| Deliveries, sqm | 286,952 | 151,232 | 90% | |
| Other regions | | | | |
| New sales, sqm | 27,907 | - | | |
| New sales, RUB mln | 3,282 | - | | |
| Number of contracts | 619 | - | | |
| Cash collections, RUB mln | 2,970 | - | | |
| Average price, RUB/sqm | 117,593 | - | | |
| Average price (apartments), RUB/sqm | 123,573 | - | | |
| Deliveries, sqm | 18,944 | - | | |
Mortgage contract developments
| | 4Q 2022 | 3Q 2022 | 2Q 2022 | 1Q 2022 | 4Q 2021 |
| Share of mortgages (total) | 58% | 37% | 25% | 33% | 40% |
| Share of mortgages (apartments) | 79% | 55% | 55% | 61% | 70% |
Commenting on the Company's FY 2022 operating results, Etalon Group CEO Gennadiy Shcherbina said:
"Despite all the challenges we faced in 2022, we were able to demonstrate our fundamental strength while also achieving tangible results.
"Our main growth path in 2022 was the expansion of our geographical footprint. We established operations in five new regions and added about 20 projects to our portfolio. We put over 650 ths sqm of NSA from our updated portfolio on sale - twice as much as the previous year. In addition, we delivered 735 ths sqm last year, setting a new record and bolstering our position among the five largest developers in Russia.
"The acquisition of YIT Russia was a major event for the Company in 2022. In addition to synergies from our combined portfolios and technological developments, the transaction had a positive impact on cash collections, which amounted to RUB 75 billion including balances in YIT Russia's accounts.
"The active expansion of our portfolio, improved product affordability and launch of new buildings helped us return to a trajectory of month-on-month sales growth by the end of the year. Further work in these areas together with the launch of more than 850 ths sqm of new space will enable us to support sustainable business growth and achieve our strategic goals to 2024."
Ilya Kosolapov, Etalon Group's Chief Financial Officer, added:
"Financial discipline in the form of cost controls and a balanced approach to debt management enabled us to demonstrate the strength of our business during a period of economic instability. We were able to keep the ratio of net corporate debt to pre-PPA EBITDA at 0.9x, well below the target level of 2x-3x.
"Our comfortable debt load and additional liquidity stemming from the release of escrow accounts will enable us to meet our strategic goals, including the development of new technologies and the acquisition of new projects, in addition to implementing projects from our current portfolio."
This and other announcements are available on the Etalon Group website: https://www.etalongroup.com/investor-relations/investor-news/
Contact information
Etalon Group
IR Team
T: +44 (0) 20 8123 1328
EM
About Etalon Group
Founded in 1987, Etalon Group is one of Russia's largest development and construction companies. The Company focuses on middle class residential real estate in the Moscow and St Petersburg metropolitan areas. In 2021, the Company began a regional expansion programme and has already launched new projects in Omsk, the Novosibirsk region, Ekaterinburg, Tyumen and Kazan. With a 35-year history, Etalon Group has one of the longest and most successful track records in the Russian real estate industry. Since its foundation, Etalon Group has delivered 8.6 mln sqm of real estate.
Thanks to its integrated business model, Etalon Group is able to create added value for customers and shareholders at every stage of development, from land plot analysis and acquisition to the operation and maintenance of existing properties. Etalon Group employs over 4,600 people, and its nationwide sales and marketing network covers 59 Russian cities.
Etalon Group's assets comprise 27 projects at the design and construction stages, unsold inventory at completed residential complexes and commercial properties, with total unsold NSA of 6.0 mln sqm, as well as a construction and maintenance division. Colliers International valued the Company's total assets at RUB 270 billion as of 31 December 2021.
In 2022, Etalon Group's new contract sales totalled 292 ths sqm, or RUB 58.7 billion.
The Company's revenue in 2021 amounted to RUB 87.1 billion, with EBITDA of RUB 17.9 billion.
Etalon Group's GDRs have traded on the Main Market of the London Stock Exchange since 20 April 2011 and in the Level 1 quotation list of Moscow Exchange since 31 January 2020 under the ticker ETLN.
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